The retail landscape is ever-evolving, with digitalisation contributing to a shift in consumer habits, brands seeking a way to keep their audience captivated and engaged are turning to retail media advertising in a bid to leave behind their focus on any one specific platform and concentrate on the broader landscape. According to a recent study by GroupM, retail media has burgeoned into a $100 billion sector globally and constitutes 18% of the total digital advertising expenditure worldwide.
What is Retail Media?
Retail media is a type of digital advertising that presents brands with ways to promote their products or services within a retailer’s e-commerce platform or physical store.
This technique involves the use of targeted advertisements and sponsored content that is displayed to shoppers while they browse and make purchases. Whilst the concept of Retail media may be relatively new to some, it is quickly gaining popularity due to its ability to provide brands with great targeted advertising opportunities whilst also enabling retailers to tap into a new revenue stream.
The core attraction for many retail media advertisers is that by leveraging customer data and analytics, retailers have the ability to create highly targeted advertising campaigns that are delivered to customers who are more likely to be interested in their products.
This symbiosis benefits both marketers and consumers, creating a tailored shopping experience and offering brands a deeper understanding of their audience.
What is a Retail Media Network?
Retail Media Networks (RMNs) are advertising platforms developed by retailers, providing brands with the opportunity to promote their products across the retailer’s own channels. Think of this as a retailer allowing a brand to place a prominent advertisement in a specific section of the store or website.
Retailers have the ability to manage the location and appearance of these promotional formats on their platforms. Moreover, they may permit advertisers to utilise specific shopper data to ensure advertisements are appropriately targeted, not only on the retailer’s platform but also across the wider internet. These networks offer a variety of tools and options for placing ads and subsequently reporting on campaign performance.
Therefore, a comprehensive definition of retail media would acknowledge its role as a component of ‘shopper marketing’, facilitating advertising both within and outside the retailer’s domains.
Why is Retail Media Gaining Popularity?
The rising popularity of online retail media networks is mainly because soon, we won’t be using third-party cookies and other digital identifiers as much. Brands are on the lookout for fresh, new ways to connect with customers using first-party data.
Retail media networks are a hit because they respect people’s privacy more and align better with what people are interested in.
This makes them a smart choice for brands wanting to get more results for their marketing spend. So, it’s not a shocker that a whopping 80% of advertisers are planning to spend more on retail media in the next year, with most of this being new spending.
Benefits of Retail Media
Brands looking to advertise find a big plus in using retail media networks. Why? Because they can show off their products to the right people! This means they get noticed more and are likely to sell more.
Also, stores give them access to super useful information. Think about what people buy, what they search for, and details at the checkout. Advertisers can use this info to make smart choices and aim their ads for better ROI. In addition, they can make their messages more personal to match what shoppers like and how they buy.
From a consumer perspective retail media network ads are also beneficial. First off, seeing the right ads means they find out about brands and products that really suit them. Further to this, because stores make money from these ads, they're not in a hurry to bump up prices. If things get pricier, they might lose shoppers, get less traffic, and make less from ads. So, thanks to retail media, shoppers can look forward to better prices.
For more information on how retail media works, you can dive deeper with our full guide on why Retail Media is The Future of Advertising.
